India
The tyre trade can be a ruthless business sometimes….Two Dunlop India managers have reportedly been beaten up by members of the INTUC employee’s union at the company’s Sahagunj factory. The Calcutta based Telegraph newspaper reports that, on the afternoon of December 17, the men were attacked following accusations of attempting to smuggle machinery out of the closed unit. One of the two was taken to hospital for observation.
Dubai’s direct tyre trade (both commercial and passenger car products) amounted to 4.15 billion UAE dirhams (£729 million, 773 million euros, US$1.13 billion) in 2007, according to the Gulf Daily News. Further growth is expected next year, the paper reported.
“Commercial tyres worth 1.1 billion (175 million, 186 million euros) dirhams for buses and lorries were imported to Dubai last year, mainly from Japan, China, and India,” said Automechanika Middle East senior show manager Michael Dehn, adding: “…Dubai consumes almost 64 per cent, re-exporting 36pc to Iran, Iraq, Saudi Arabia, and Africa. The commercial vehicle market is an essential industry in the UAE and an increase of 35 per cent is expected from this year to 2012.”
Dunlop India’s bid for a 1 billion rupee “soft loan” to aid with the reopening of its Sahagunj plant has been turned down by the West Bengal government. The plant has been closed since 30 November and looks set to see in the New Year before work restarts. Labour minister Mrinal Banerjee told Indian news sources, including The Hindu, that the company cannot be helped as it is not “sick”.
Company chairman Pawan Ruia had demanded a series of incentives that he believed were due from promised state aid. The minister voiced the concerns of the factory’s 1,171 workers that Ruia would sell off the factory’s site. He told newspapers, “If he now sells the land with the support of a political party, we don’t know what will happen.”
Dunlop India is becoming something of a political hot potato in the run-up to the election in the Lok Sabha, the country’s house of representatives. With the support of West Bengal politician Mamata Banerjee, company chief managing director Pawan Ruia is reported by the Times of India to be perhaps placing political pressure on the West Bengal government to gain Dunlop India additional concessions of a nature normally reserved for ‘sick’ units; that is, companies that at the end of any financial year have accumulated losses equal to or exceeding their entire net worth. And the government, says the Times of India, is holding its tongue on political grounds.
Continental has launched several products on the Indian market to cater for four-wheel vehicles and is hoping to secure OE agreements with Tata Motors and Mahindra & Mahindra, The Hindu’s Business Line news source reports. The website quotes Andrea Esser, the company’s executive vice president (replacement Asia), saying, “We are in discussion with Tata Motors and Mahindra & Mahindra for their domestic as well as export vehicles.”
Esser commented on the launch, saying that it represents, “part of our overall growth strategy and commitment to the Asia Pacific region. With the growth in auto industry here, we believe that we should actively take part in India. We plan to develop a significant market share in India.” Questioned about where the tyres would be coming from, Esser maintained that they would all be imported and that there are no plans as yet to produce domestically: “Currently we will be importing tyres only as sales are very low. Once it attains a good volume, then we may think of locally producing our tyres.”
Michelin India has announced an agreement to supply its silica based compound tyre Energy XM1 tyre as OE to the new Honda City in the Indian market.
“This initiative is part of our long term strategy for India and has also strengthened our relationship with Honda and we hope to continue with this relationship” said Mr. Jean Paul Caylar, the CEO of Michelin in India.
With the help of the Singapore Government’s Standards, Productivity and Innovation Board, Singapore based company Tyrepac is developing what it says is Asia’s first online tyre retailing site. The company’s first website, for the Singapore market, is already up and running, and the company states that websites for China, Malaysia, Thailand, Korea and Hong Kong will be live in late March 2009. Plans are also underway to expand into India, Indonesia, Japan, the Philippines, Australia and New Zealand.
Following news that Apollo has cut prices across the board in line with the four per cent reduction in India’s Central VAT rate, Ceat and JK Tyre have announced similar cuts of 3.6 and 3 per cent respectively on the average price of their products.
Apollo’s chairman, Onkar Kanwar wrote in a statement, following yesterday’s announcement on India’s cenvat, “We will be passing on this reduction to our customers, strengthening the measures that are being taken at a federal level.
“We do hope this, and other measures together, will boost production and consumer spending,” he concluded. JK’s director, AS Mehta voiced similar hopes: “Once the end user is benefited, it should benefit the entire industry.”
Dunlop India chief managing director Pawan Ruia has been reportedly accused of cheating the company’s workers. This accusation, printed in the Times of India, was made by Centre of Indian Trade Unions state secretary Kali Ghosh and members of parliament Rupchand Pal and Shantosree Chatterjee (both from the Communist Party of India (Marxist) party). The union official and two politicians, says the newspaper, are of the opinion that Dunlop’s Sahaganj facility should be handed over to India’s Ministry of Defence.
Apollo Tyres gave word on December 6 that a plant owned by PTL Enterprises that produces tyres exclusively for Apollo entered a lockout situation as of 2am December 6. Tension between workers and employers at the Kalamassery based factory, in India’s Kerala state, has been uneasy for some time. According to Apollo, for the past few months “workmen have been resisting management efforts to increase efficiency and bring down costs, during these times of economic stress and demand slowdown.”
Imported bus and truck radial tyres have been categorised as a restricted item by India’s Director General of Foreign Trade (DGFT). News of this action was given in a DGFT notification dated November 24, 2008. Items restricted by the DGFT generally can only be imported into India via the obtaining of an appropriate license.
Leading Indian tyre maker, Apollo has announced that it has cut its prices across its product range by around four per cent. India has reduced its Cenvat (Central VAT) by the same figure on 7 December. Apollo’s price cut is effective as of 1 December.
Ceat Ltd. has broken ground on a £95 million radial tyre factory in the Indian state of Gujarat. The new factory is expected to eventually produce up to 500 tonnes of passenger, light and medium truck tyres a day, with as much as 40 per cent of production earmarked for export. According to Ceat, the factory will be constructed in three phases, with the first of these entering production in June 2010. Daily capacity at this time will be in the area of 100 to 150 tonnes.
Special chemicals group Lanxess AG has announced the formation of an alliance with Japan-based Tokyo Zairyo to sell rubber chemicals to Japanese companies engaged in the industrial rubber product sector within China. This cooperative agreement took effect on December 1, and the German company expects that the partnership will also help its sales in Japan and other Asian countries.
Bridgestone has concluded an agreement with India’s Sundaram Industries to establish a joint venture to produce anti-vibration rubber for use in vehicles. The Tamil Nadu based company is a member of India’s Prominent TVS Group, and a leader in the field of anti-vibration rubber in that country. Bridgestone first concluded a technical assistance agreement in anti-vibration rubber for automobiles business with Sundaram Industries in 1996, and the two companies have built a close relationship over the years. Bridgestone believes the joint venture will enable the production and sale of high-quality products boasting technical superiority at a competitive cost in the expanding Indian market, and lead to an enhanced global supply chain.
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